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ABC, Incorporated became a successful business as the result of substantial “sweat-equity” to develop and deliver a new or better product/service plus stellar customer service. XYZ, Incorporated is an unscrupulous competitor and wanted to achieve ABC’s success, without ABC’s investment.

So what does XYZ do? Easy. They discover the names of ABC’s top three customers and contact them hoping they’ll start doing business with XYZ, despite the standing ABC sales/service contracts.

This is a very common, real-world scenario. When it occurs, the impact on ABC can be very damaging. Many businesses contact our law firm to help “stop the bleeding.”

We ask our clients for the following information to help us take swift action:
1. Show us the contract you have with your customer so we can determine if it’s valid;
2. Provide us with complete information to establish that your competitor willfully and intentionally interfered with your contract;
3. Describe how that interference caused you damages; and
4. Calculate the actual amount of damages you incurred.

If we get the answers to support a claim against the competitor, most times our first course of action is to ask the court to grant a temporary restraining order (“TRO”) which requires the competitor – now defendant – to stop interfering with our client’s contract. If this TRO is granted, the defendant is served with it along with an order informing them that within 14 days, at a hearing the court will consider setting aside the TRO or turning it into a preliminary injunction during the pendency of the lawsuit. This is like a mini-trial, and is critical to our client’s case.

If we are successful at this hearing, many times the defendant will agree to settle the entire case by paying our client the money they lost and agreeing to accept a permanent injunction not to interfere with that contract. If they do not, we immediately take steps to establish the amount of money our client has lost as a result of the defendant’s interference. This part of the lawsuit has several steps, which depending on the circumstances of the case could take three months or longer.

Here’s the good news: nearly every one of these “business interference” cases we’ve handled has led to a prompt and successful result.

To prevent a scenario like this one from developing, we recommend our clients send us their proposed contracts in advance of any deal. We can assist in drafting them and clients can be confident their agreements are valid.

We also suggest clients closely monitor all accounts. For example, we encourage them to ask their customers if they are satisfied with the product or service delivery performance under the contract. We recommend they acquire this feedback in writing and maintain a file of documented customer satisfaction.

Finally, in the event you become concerned that an unscrupulous company is attempting to interfere with your customers and a sales/service agreement, contact our legal firm immediately, so we can take swift, appropriate action.

Maintaining solid business contracts can help you avoid litigation, hefty attorney’s fees, and losing customers you’ve worked hard to earn.

Mark A. Alexander
5080 Spectrum Suite 850
Addison, Texas 75001
Ph: 972.544.6968
Fax: 972.421.1500
E-Mail: [email protected]

By | 2019-03-15T21:33:51+00:00 August 4th, 2015|Blog|0 Comments

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